The path is clear for the proposed construction of an incinerator on the outlying island of Shek Kwu Chau after the Court of Final Appeal rejected a challenge against it.
The five-judge panel has reserved reasons for their judgment to a later date.
The judicial review on the HK$19 billion proposal was launched by Cheung Chau resident Leung Hon-wai, who claimed the incinerator would affect the health of those on the nearby island.
The Director of Environmental Protection approved an environmental impact assessment report in January 2012, and granted a construction permit the same year.
Leung argued that the director did not have the power to approve an application that was made by her own department. Instead, his lawyer told the court that the application should have been made by other government departments.
The Legislative Council Finance Committee approved the funding request for the project in January. The government plans to start building the incinerator next year, and it is scheduled to begin operation in 2022.